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Wednesday, March 31, 2010

President Announces Offshore Energy Proposals; Reactions Mixed

Mar 31: As part of the Administration's comprehensive energy strategy President Barack Obama and Secretary of the Interior Ken Salazar announced more details of the Obama Administration's efforts to strengthen our energy security. President Obama and Secretary Salazar announced that the Administration will expand oil and gas development and exploration on specified sections of the U.S. Outer Continental Shelf (OCS) which they say will "enhance the nation's energy independence while protecting fisheries, tourism, and places off U.S. coasts that are not appropriate for development." Also included in the announcement were landmark car and truck fuel standards, key efforts being carried out by the Department of Defense to enhance energy security, and an effort to green the Federal vehicle fleet.

President Obama said, "We're here to talk about America's energy security, an issue that's been a priority for my administration since the day I took office. Already, we've made the largest investment in clean energy in our nation's history. It's an investment that's expected to create or save more than 700,000 jobs across America -- jobs manufacturing advanced batteries for more efficient vehicles; upgrading the power grid so that it's smarter and it's stronger; doubling our nation's capacity to generate renewable electricity from sources like the wind and the sun.

"And just a few months after taking office, I also gathered the leaders of the world's largest automakers, the heads of labor unions, environmental advocates, and public officials from California and across the country to reach a historic agreement to raise fuel economy standards in cars and trucks. And tomorrow, after decades in which we have done little to increase auto efficiency, those new standards will be finalized, which will reduce our dependence on oil while helping folks spend a little less at the pump. So my administration is upholding its end of the deal, and we expect all parties to do the same. And I'd also point out this rule that we're going to be announcing about increased mileage standards will save 1.8 billion -- billion barrels of oil overall -- 1.8 billion barrels of oil. And that's like taking 58 million cars off the road for an entire year. . .

"We need to make continued investments in clean coal technologies and advanced biofuels. A few weeks ago, I announced loan guarantees to break ground on America's first new nuclear facility in three decades, a project that will create thousands of jobs. And in the short term, as we transition to cleaner energy sources, we've still got to make some tough decisions about opening new offshore areas for oil and gas development in ways that protect communities and protect coastlines. This is not a decision that I've made lightly. It's one that Ken and I -- as well as Carol Browner, my energy advisor, and others in my administration -- looked at closely for more than a year. But the bottom line is this: Given our energy needs, in order to sustain economic growth and produce jobs, and keep our businesses competitive, we are going to need to harness traditional sources of fuel even as we ramp up production of new sources of renewable, homegrown energy. . .

"That's why my administration will consider potential areas for development in the mid and south Atlantic and the Gulf of Mexico, while studying and protecting sensitive areas in the Arctic. That's why we'll continue to support development of leased areas off the North Slope of Alaska, while protecting Alaska's Bristol Bay. . . I want to emphasize is that this announcement is part of a broader strategy that will move us from an economy that runs on fossil fuels and foreign oil to one that relies more on homegrown fuels and clean energy. . . drilling alone can't come close to meeting our long-term energy needs. And for the sake of our planet and our energy independence, we need to begin the transition to cleaner fuels now.

"So the answer is not drilling everywhere all the time. But the answer is not, also, for us to ignore the fact that we are going to need vital energy sources to maintain our economic growth and our security. Ultimately, we need to move beyond the tired debates of the left and the right, between business leaders and environmentalists, between those who would claim drilling is a cure all and those who would claim it has no place. Because this issue is just too important to allow our progress to languish while we fight the same old battles over and over again. . .

"So I'm open to proposals from my Democratic friends and my Republican friends. I think that we can break out of the broken politics of the past when it comes to our energy policy. I know that we can come together to pass comprehensive energy and climate legislation that's going to foster new energy -- new industries, create millions of new jobs, protect our planet, and help us become more energy independent. That's what we can do. That is what we must do. And I'm confident that is what we will do."

The Administration's strategy calls for developing oil and gas resources in new areas, such as the Eastern Gulf of Mexico; increasing oil and gas exploration in frontier areas, such as parts of the Arctic and Atlantic Oceans; and protecting ocean areas that are simply too special to drill, such as Alaska's Bristol Bay. The strategy will guide the current 2007-2012 offshore oil and gas leasing program, as well as the new 2012-2017 program that this administration will propose.

In addition the White House announced that On April 1st, EPA and DOT will sign a joint final rule establishing greenhouse gas emission standards and corporate average fuel economy standards for light-duty vehicles for model years 2012-2016 [See WIMS 5/19/09]; doubling the Federal hybrid vehicle fleet and purchase the first 100 plug-in electric vehicles by the end of the year; and reducing the military's heavy reliance on fossil fuels.

House Speaker Nancy Pelosi (D-CA) issued a statement praising the parts of the Obama proposal that did not deal with offshore drilling; and regarding drilling said, "The Obama Administration's initiative regarding drilling on public lands must ensure that any offshore and onshore plan proceeds in an environmentally and fiscally responsible manner. Taxpayers who own these resources have been historically shortchanged from the huge profits received from drilling on public lands, and must receive a fair return in the future.

U.S. Senate Republican Leader Mitch McConnell (R-KY) issued a statement saying, "Today's announcement is a step in the right direction, but a small one that leaves enormous amounts of American energy off limits. And the proof of the administration's announcement will be in the implementation: will the administration actually take concrete steps to finish the studies, approve the necessary permits, and open these areas for production? Will they stand by as their allies act to delay the implementation in the courts? The American people believe that to strengthen our national and energy security we should rely more on America's energy resources, and less on those of the Middle East. It's time to put America's energy to work for the American people, without the threat of a new national energy tax."

House Republican Leader John Boehner (R-OH) issued a statement criticizing the Obama Administration. Boehner said, "The Obama Administration continues to defy the will of the American people who strongly supported the bipartisan decision of Congress in 2008 to lift the moratorium on offshore drilling not just off the East Coast and in the Gulf of Mexico, but off the Pacific Coast and Alaskan shores as well. Opening up areas off the Virginia coast to offshore production is a positive step, but keeping the Pacific Coast and Alaska, as well as the most promising resources off the Gulf of Mexico, under lock and key makes no sense at a time when gasoline prices are rising and Americans are asking 'Where are the jobs?'

"It's long past time for this Administration to stop delaying American energy production off all our shores and start listening to the American people who want an "all of the above" strategy to produce more American energy and create more jobs. Republicans are listening to the American people and have proposed a better solution -- the American Energy Act -- which will lower gas prices, increase American energy production, promote new clean and renewable sources of energy, and encourage greater efficiency and conservation. At the same time the White House makes today's announcement, the Environmental Protection Agency (EPA) is plotting a new massive job-killer that the American people can't afford: a cascade of new EPA regulations that will punish every American who dares to flip on a light switch, drive a car, or buy an American product. Americans simply don't want this backdoor national energy tax that will drive up energy and manufacturing costs and destroy jobs in our states and local communities."

Senator Jeff Bingaman (D-NM), Chair of the Senate Energy & Natural Resources Committee said, "I commend Secretary Salazar for proposing a plan that makes available for leasing much of the potential offshore oil and gas resources that the Federal government owns. I also commend him for indicating that additional studies will be undertaken before making a final decision on leasing in areas that might be environmentally sensitive. Secretary Salazar's proposed plan is generally consistent with the legislative proposals regarding our offshore national oil and gas resources that the Senate Energy and Natural Resources Committee reported last summer [See WIMS 6/17/09]. I hope that the Senate will address these legislative proposals in the coming weeks."

Alaska Senators Lisa Murkowski (R) and Mark Begich (D) released a joint statement. Sen. Murkowski said, "I appreciate the department's decision to allow valid existing rights to explore Alaska's huge offshore oil and gas reserves to go ahead. I will work with the administration on proceeding with important future lease sales off Alaska's coast, as well as along the Atlantic coast and the Eastern Gulf of Mexico." Sen. Begich said, "Alaska's energy companies should be pleased with the green light from the Obama administration to proceed toward oil and gas development in the Chukchi and Beaufort seas under the current lease schedule. As the site of the world's largest salmon fishery, the President's proposal to curtail oil and gas development in Bristol Bay makes sense. I commend the Obama administration, and especially Interior Secretary Ken Salazar, for reaching out to Alaskans and incorporating our recommendations in today's decision."

The American Petroleum Institute (API) President and CEO Jack Gerard issued a statement on the Interior Department's Five-Year Plan and said, "The announcement by President Obama and Secretary Salazar is a positive development. We look forward to reviewing the details of the proposal, and we stand ready to work with them to make this a reality. We appreciate the administration's recognition of the importance of developing our nation's oil and natural gas resources to create jobs, generate revenues and fuel our nation's economy. Exploring for and developing our nation's offshore resources could help generate more than a trillion dollars in revenues and create thousands of jobs to add to the already 9.2 million jobs supported by today's oil and natural gas industry.

"As we move forward, we hope that consideration can be given to other resource-rich regions, such as the Destin Dome area of the Eastern Gulf and areas off the Pacific Coast and Alaska. We also need to ensure that the permitting processes are handled in an expeditious way. The oil and natural gas industry has a proven track record of safe oil and natural gas development and the majority of the American people recognize this by supporting greater offshore development for the benefit of their communities, their states and their nation."

Sierra Club Executive Director Michael Brune issued a statement saying, "We're very disappointed to see important areas like the Arctic coast and the Mid and South Atlantic stay open to oil drilling. What we need is bold, decisive steps towards clean energy, like the new clean cars regulations announced this week -- not more dirty, expensive offshore drilling. The oil industry already has access to drilling on millions of acres of America's public lands and water. We don't need to hand over our last protected pristine coastal areas just so oil companies can break more profit records. Drilling areas like the Arctic threatens marine life like whales and polar bears. Where there is offshore drilling, there is a constant danger of oil spills. One oil spill is all it takes to destroy a coastal tourism economy and the jobs that depend on it. Drilling our coasts will doing nothing to lower gas prices or create energy independence. It will only jeopardize beaches, marine life, and coastal tourist economies, all so the oil industry can make a short-term profit. . ."

Brendan Cummings, senior counsel at the Center for Biological Diversity (CBD) said, "Today's announcement is unfortunately all too typical of what we have seen so far from President Obama -- promises of change, a year of 'deliberation,' and ultimately, adoption of flawed and outdated Bush policies as his own. Rather than bring about the change we need, this plan will further our national addiction to oil and contribute to global warming, while at the same time directly despoiling the habitat of polar bears, endangered whales, and other imperiled wildlife." CBD said, "Oil development in the Beaufort and Chukchi seas, home to all of America's polar bears, is strongly opposed by conservation groups as no technologies exist to clean up oil spills in icy waters. Oil development in the Beaufort Sea would likely also be visible from the shores of the Arctic National Wildlife Refuge. Today's plan would allow existing leases in the Chukchi and Beaufort seas to move forward while the remainder of these areas would be subject to additional leasing following further environmental studies."

Frances Beinecke, President of the Natural Resources Defense Council (NRDC) said, "We need comprehensive solutions for America's clean energy future -- and more offshore drilling in our oceans does not fit in that picture. Offshore drilling carries significant environmental risks without truly increasing our energy independence. There are many areas that are just too sensitive for offshore drilling, which threatens our oceans, sea life and coastal communities; including economic interests in these areas. America has better solutions than to drill in our pristine waters -- which needs more research and investigation -- and we should be pursuing these options. . . "In order to fully achieve a clean energy future, we need the administration and Congress to enact truly comprehensive energy and climate policies that will cut our dependence on oil, limit carbon pollution and create jobs. We now look to the Senate to advance comprehensive legislation -- that is being crafted by Senators Kerry, Graham, Lieberman and others -- to make our country stronger, safer and more secure."

Access a release from the White House (click here). Access the full text of the President's speech (click here). Access more specific details on the offshore drilling plan (click here). Access more information on DoD's energy initiatives (click here).